3D Systems Closes XRX's Ink Teams Buy - Analyst Blog

By: Zacks.com

Posted: 1/3/2014 7:00:00 PM

Referenced Stocks: APELY;DDD;PLNR;XRX

3D Systems Corp.
(
DDD
)
completed the acquisition of a part of
Xerox Corporation's
(
XRX
) product design, engineering and chemistry group and related
assets. The deal is an all-cash transaction and is valued at
$32.5 million.

This acquisition comes after a 15-year-long partnership
between the companies and is expected to close by the end of
fiscal 2013, subject to regulatory approvals. However, Xerox will
retain its ink and print head development resources along with
research relevant for digital printing and the 3D markets. The
decision to acquire was announced on Dec 19, 2013.

The acquisition is a strategic move by 3D Systems, as it
expands the company's existing partnership and also integrates
some of Xerox's ultra modern state-of-the art labs, together with
certain licensed IPs belonging to Xerox. All these will support
development and manufacturing of 3D printers, going forward. 3D
Systems expects to begin operating its own facility effective
immediately, at Xerox's Wilsonville
campus.

Through this purchase, 3D Systems intends to add about 100
experienced engineers and contractors from Xerox primarily
specializing in product design and materials science. This apart,
3D System expects to increase its R&D (research and
development) expenditures annually in the range of 75% to 100%
over the next few years. The company also intends to fulfill some
of its pending commitments to Xerox to fully benefit from the
expanded capabilities, going forward.

3D Systems has been aggressively pursuing acquisitions since
Aug 2013 to expand its capability, capacity and geographic reach.
In August, the company purchased design-oriented, cloud-computing
service TeamPlatform and CRDM, a U.K.-based firm that provides
prototyping and tooling services. Following that, in September,
the company announced the acquisition of Sugar Labs, a
California-based 3D printer of custom edible products made from
sugar.

Also, just last week, 3D Systems acquired Figulo Corporation,
the industry's leading consumer-oriented 3D ceramics printer. On
Dec 16, the company acquired Ohio-based 3D filament manufacturer,
Village Plastics Co. for an undisclosed sum.

3D Systems is a leading provider of 3D content-to-print
solutions including 3D printers, print materials and on-demand
custom parts services for professionals and consumers alike. In
addition, the company provides creative content development and
design productivity tools. The company also offers software
design tools including CAD (computer-aided design), reverse
engineering and inspection, and consumer 3D printers, apps and
services.